THE BETRAYAL OF THE AMERICAN DREAM

An angry attack on Washington and the wealthy, asserting that their alliance has distorted the economy, shrunk the middle class and enriched the already rich.

Competing polemics rely on predictions of a dire future, but veteran investigative reporters Barlett and Steele point out that they delivered identical warnings in America: What Went Wrong (1992)—all of which came true. They maintain that the deficit is less the result of government programs than plummeting tax revenue from the rich, who paid 51.2 percent of their income in 1955 versus 16.6 percent today. Congress once assumed that salaried workers shouldn’t pay more than the rich, who lived on dividends. They reversed this in 2003, capping the dividend rate at 15 percent. More than half of large American corporations pay no tax. Since the 1970s, advocates of deregulation and free trade persistently proclaim that it increases jobs and reduces the trade deficit, apparently unaware that the exact opposite almost always happens. The authors’ solutions include: Revise the tax code so corporations and the rich pay more than the middle class instead of less, discard the clueless ideology of free trade (no other nation believes it), re-regulate disastrously unregulated areas, and enforce current laws equally instead of giving the influential a free pass. The authors describe genuine problems, but their solutions would produce outrage among congressional Republicans (obscenities such as “tax increase,” “government regulation,” “protectionism” and “class warfare” would fill the air) and no enthusiasm from Democrats. Reforms since the 2008 crash have been easily defeated or watered down.

Readers must cling to the hope that things are not as bad as the authors claim.